Secure Your Investment in House Flipping

House flipping has gained popularity thanks to TV shows that highlight its apparent simplicity: buy a property, renovate it, and sell it at a higher price. However, this business is not without challenges. Beyond buying low and selling high, success depends on factors like:

• Securing adequate financing.
• Completing the work and permits on time.
• Selling within the set timeframe.

Any setbacks can significantly affect the profitability of the project, making it crucial to have the right protection.

The Risks of House Flipping

On average, investors hold a property for three to four months while completing necessary repairs before selling it. During this time, unexpected issues can arise that impact profit margins.

Practical Example:

Suppose you and a partner purchase a property for $150,000, plan to spend $80,000 on renovations, and project to sell it for $330,000 within three months. Halfway through the project, vandals break into the house, damaging parts of the structure and stealing tools, materials, and installed equipment. The damage exceeds $60,000. This event could:

• Delay the project’s completion.
• Increase repair and material costs.
• Significantly reduce profit margins or even cause losses.

The Solution: Builder’s Risk Insurance

To protect your investment against unforeseen events, there is a specialized insurance called Builder’s Risk Insurance. This policy is designed for construction and renovation projects, offering coverage for:

• Theft and vandalism: Protects tools, materials, and equipment inside the property.
• Structural damage: Covers fires, storms, wind, hail, and vehicle collisions.

Policy Flexibility:

• It can be contracted for 30-day periods with monthly renewal options.
• It can also be purchased for the entire estimated project duration.

If an incident occurs, this insurance covers replacement costs, ensuring your investment remains secure.

In Conclusion: Protect Your Business and Guarantee Your Profits

House flipping can be lucrative, but only if you’re protected against unexpected risks. Don’t put your money or plans at risk. Call Univista Insurance today and request a specialized insurance plan to protect your project and give you peace of mind.